TITLE 16.ECONOMIC REGULATION

Part 1. RAILROAD COMMISSION OF TEXAS

Chapter 8. PIPELINE SAFETY REGULATIONS

The Commission proposes amendments to §8.1, relating to General Applicability and Standards, §8.201, relating to Pipeline Safety Program Fees, and §8.210, relating to Reports.

Section 8.1(b) concerns minimum safety standards and adopts by reference the United States Department of Transportation's (USDOT) pipeline safety standards found in 49 U.S.C. §§60101, et seq. ; 49 Code of Federal Regulations (CFR) Part 191, Transportation of Natural and Other Gas by Pipeline; Annual Reports, Incident Reports, and Safety-Related Condition Reports; 49 CFR Part 192, Transportation of Natural and Other Gas by Pipeline: Minimum Federal Safety Standards; 49 CFR Part 193, Liquefied Natural Gas Facilities: Federal Safety Standards; 49 U.S.C. §§60101, et seq. ; 49 CFR Part 195, Transportation of Hazardous Liquids by Pipeline; and 49 CFR Part 199, Drug and Alcohol Testing. The current rule adopts the federal pipeline safety standards as of April 9, 2004; the proposed amendment will show this date as September 14, 2004. The federal safety rule amendments that will be captured are summarized in the following paragraphs.

USDOT's Amendment No. 192-96, published at 69 Federal Register (FR) 27861, referred to a final rule published by the Research and Special Programs Administration (RSPA) on September 15, 2003, concerning the operation and capacity of existing pressure limiting and regulating stations on gas pipelines. The rule inadvertently established a pressure limit that could require a reduction in the operating pressure of some pipelines and be impracticable for others to meet. This direct final rule establishes an appropriate pressure limit to avoid these unintended results. The effective date for the direct final rule was September 14, 2004.

USDOT's Amendment No. 192-97, published at 29 FR 36024, concerned a regulation published by RSPA requiring that new gas transmission lines and sections of existing transmission lines in which pipe or components are replaced be designed and constructed to accommodate the passage of instrumented internal inspection devices. Responding to petitions for reconsideration, RSPA stayed enforcement on some facilities and invited comments on proposed changes to the regulation. The present action concludes RSPA's consideration of the petitions and comments. For existing onshore transmission lines, this action restricts the regulation to replacements of pipe or components. For offshore transmission lines, the regulation is restricted to certain new lines that run between platforms or from platforms to shore. The action aligns the regulation with the supporting congressional directive and a related Marine Board recommendation. The effective date was July 28, 2004; however, offshore transmission lines covered by revised §192.150 are those on which construction begins after December 28, 2005.

Amendment Nos. 192-98 and 195-82, published at 69 FR 48400, amended the pipeline safety regulations to require operators of gas and hazardous liquid pipelines to prepare and follow procedures for periodic inspections of pipeline facilities located in the Gulf of Mexico and its inlets in waters less than 15 feet deep. These inspections will inform the operator if the pipeline is exposed or a hazard to navigation. The effective date was September 9, 2004.

Amendment Nos. 195-81 and 199-22, published at 69 FR 32886, were part of a RSPA final rule incorporating the most recent editions of the voluntary consensus standards and specifications referenced in the federal pipeline safety regulations to enable pipeline operators to utilize the most current technology, materials, and industry practices in the design, construction, and operation of their pipelines. This rule also increased the design pressure limitation for new thermoplastic pipe, allowed the use of plastic pipe for certain bridge applications, increased the time period for revision of maximum allowable operating pressure after a change in class location, clarified welding requirements, and made various other editorial clarifications and corrections. The final rule does not require pipeline operators to undertake any significant new pipeline safety initiatives. The effective date was July 14, 2004. After this effective date, RSPA published a correction to Amendment 195-81 at 69 FR 54591; the original final rule included an inadvertent error in the definition of "transmission line" in §192.3, failed to properly amend Appendix B to part 192, inadvertently reversed a recent amendment to a welder qualification requirement in §195.222, and contained several typographical errors. The correction revises the relevant sections. The effective date remained July 14, 2004.

In a previous adoption of updated USDOT changes, the Commission inadvertently left out USDOT Amendment No. 21 to 49 CFR Part 199. That amendment, published at 68 FR 75455, concerned USDOT's drug and alcohol testing rules and included requirements for select employers to submit drug and alcohol testing data to five DOT agencies. In the past, these employers have been required to use agency-specific Management Information System (MIS) forms for this purpose, 21 different forms in all. USDOT published a final rule revising these MIS forms into a single one-page form for use through all the DOT agencies. The requirement for use of the form is now in 49 CFR Part 40. By this action, the DOT agencies endorsed the use of this single form within their regulated industries, provided their regulated employers with guidance for submission of the form, and amended their rules accordingly. The DOT agencies are the Federal Motor Carrier Safety Administration (FMCSA), the Federal Aviation Administration (FAA), the Federal Transit Administration (FTA), the Federal Railroad Administration (FRA), and the Research and Special Programs Administration (RSPA). The effective date of that action was December 31, 2003. The Commission includes this amendment in this proposal for clarification purposes; pipeline operators were already required to comply with the amendment as of December 31, 2003.

The proposed amendments in §8.201(a) correct a typographical error; in subsection (b)(1) and (2) change the calendar year from 2003 to 2004 and the deadline by which the annual pipeline safety program fee is to be filed from March 15, 2004, to March 15, 2005; and in subsection (b)(3)(E) add wording that state agencies, as defined in Texas Utilities Code, §101.003, shall not be billed this fee. This exemption is being proposed as part of the resolution of litigation brought by the Office of the Attorney General challenging the Commission's authority to charge the pipeline safety fee to state agency customers of gas utilities. The fee remains at $0.37.

The proposed amendment in §8.210(a)(4)(A) corrects an internal citation.

Mary McDaniel, Director, Safety Division, has determined that for the first five years the amendments will be in effect, there will be no fiscal implications for state or local governments as a result of enforcing or administering the proposed amendments. Specifically with regard to the proposed amendments in §8.201, Ms. McDaniel has determined that the $0.37 per service line pipeline safety fee will continue to generate sufficient revenue to the Commission for the pipeline safety program even with the exemption of state agency customers.

Ms. McDaniel has determined that for each year of the first five years that the amendments will be in effect, the primary public benefit will be the continuation of the Commission's Pipeline Safety program to ensure public safety with regard to pipeline operations and accurate reference to federal pipeline safety standards enforced by the Commission.

The Commission anticipates that there will be no additional cost to individuals, small businesses, or micro-businesses of complying with the proposed amendments. The proposed amendment to §8.1 would simply change the date as of which the Railroad Commission has adopted by reference the federal pipeline safety rules. Texas pipelines are already required to comply with the federal rules. Under 49 U.S.C. §§60101, et seq. , the Railroad Commission is authorized to enforce pipeline safety laws so long as the state's scheme of regulation is as strict as or stricter than the federal system. In order to be considered "as strict as or stricter than" the federal scheme of regulation, the state must adopt every federal rule; there are no exceptions for rules of limited application. Therefore, even though the rules already apply in Texas, the Railroad Commission must also adopt the rules for its own system. The proposed amendments to §8.201 correct typographical errors; amend the dates on which operators of natural gas distribution systems and master meter systems are obligated to file reports and/or remit pipeline safety fee assessments to the Commission; and explicitly exempt state agency customers from payment of the fee. These changes do not impose a greater burden on any affected person or state agency; to the extent that a state agency is affected by the proposed explicit exemption, it is a benefit of $0.37 per service line per year. Finally, the proposed amendment to §8.210(a)(4)(A) corrects an internal citation, but does not change the scope or application of the rule.

The public benefit anticipated as a result of the enforcement of these amendments will be enhanced public safety and increased awareness of safety requirements in the transportation of natural gas, carbon dioxide, and hazardous liquids because the rules will be correctly stated.

Comments on the proposal may be submitted to Rules Coordinator, Office of General Counsel, Railroad Commission of Texas, P.O. Box 12967, Austin, Texas 78711-2967; online at www.rrc.state.tx.us/rules/commentform.html; or by electronic mail to rulescoordinator@rrc.state.tx.us. The Commission will accept comments for 30 days after publication in the Texas Register ; comments should refer to Docket No. 9566. The Commission encourages all interested persons to submit comments no later than the deadline. The Commission cannot guarantee that comments submitted after the deadline will be considered. For further information, call Ms. McDaniel at (512) 463-7166. The status of Commission rulemakings in progress is available at www.rrc.state.tx.us/rules/proposed.html.

Subchapter A. GENERAL REQUIREMENTS AND DEFINITIONS

16 TAC §8.1

The Commission proposes the amendments under Texas Natural Resources Code, §81.051 and §81.052, which give the Commission jurisdiction over all common carrier pipelines in Texas, persons owning or operating pipelines in Texas, and their pipelines and oil and gas wells, and authorize the Commission to adopt all necessary rules for governing and regulating persons and their operations under the jurisdiction of the Commission as set forth in §81.051, including such rules as the Commission may consider necessary and appropriate to implement state responsibility under any federal law or rules governing such persons and their operations; Texas Utilities Code, §§121.201 - 121.210, which authorize the Commission to adopt safety standards and practices applicable to the transportation of gas and to associated pipeline facilities within Texas to the maximum degree permissible under, and to take any other requisite action in accordance with, 49 United States Code Annotated, §§60101, et seq. ; and Texas Utilities Code, §121.211, authorizes the Railroad Commission to adopt, by rule, an inspection fee to be assessed annually against operators of natural gas distribution pipelines and their pipeline facilities and natural gas master metered pipelines and their pipeline facilities.

Texas Natural Resources Code, §81.051 and §81.052; Texas Utilities Code, §§121.201 - 121.211; and 49 United States Code Annotated, §§60101, et seq. , are affected by the proposed amendments.

Statutory authority: Texas Natural Resources Code, §81.051 and §81.052; Texas Utilities Code, §§121.201 - 121.211; and 49 United States Code Annotated, §§60101, et seq .

Cross-reference to statute: Texas Natural Resources Code, Chapter 81; Texas Utilities Code, Chapter 121; and 49 United States Code Annotated, Chapter 601.

Issued in Austin, Texas, on February 8, 2005.

§8.1.General Applicability and Standards.

(a) (No change.)

(b) Minimum safety standards. The Commission adopts by reference the following provisions, as modified in this chapter, effective September 14, 2004 [ April 9, 2004 ].

(1) - (3) (No change.)

(c) - (f) (No change.)

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on February 8, 2005.

TRD-200500586

Mary Ross McDonald

Managing Director

Railroad Commission of Texas

Earliest possible date of adoption: March 27, 2005

For further information, please call: (512) 475-1295


Subchapter C. REQUIREMENTS FOR NATURAL GAS PIPELINES ONLY

16 TAC §8.201, §8.210

The Commission proposes the amendments under Texas Natural Resources Code, §81.051 and §81.052, which give the Commission jurisdiction over all common carrier pipelines in Texas, persons owning or operating pipelines in Texas, and their pipelines and oil and gas wells, and authorize the Commission to adopt all necessary rules for governing and regulating persons and their operations under the jurisdiction of the Commission as set forth in §81.051, including such rules as the Commission may consider necessary and appropriate to implement state responsibility under any federal law or rules governing such persons and their operations; Texas Utilities Code, §§121.201 - 121.210, which authorize the Commission to adopt safety standards and practices applicable to the transportation of gas and to associated pipeline facilities within Texas to the maximum degree permissible under, and to take any other requisite action in accordance with, 49 United States Code Annotated, §§60101, et seq. ; and Texas Utilities Code, §121.211, authorizes the Railroad Commission to adopt, by rule, an inspection fee to be assessed annually against operators of natural gas distribution pipelines and their pipeline facilities and natural gas master metered pipelines and their pipeline facilities.

Texas Natural Resources Code, §81.051 and §81.052; Texas Utilities Code, §§121.201 - 121.211; and 49 United States Code Annotated, §§60101, et seq. , are affected by the proposed amendments.

Statutory authority: Texas Natural Resources Code, §81.051 and §81.052; Texas Utilities Code, §§121.201 - 121.211; and 49 United States Code Annotated, §§60101, et seq .

Cross-reference to statute: Texas Natural Resources Code, Chapter 81; Texas Utilities Code, Chapter 121; and 49 United States Code Annotated, Chapter 601.

Issued in Austin, Texas, on February 8, 2005.

§8.201.Pipeline Safety Program Fees.

(a) Pursuant to Texas Utilities Code, §121.211, the Commission establishes a pipeline safety inspection fee, to be assessed annually against operators of natural gas distribution pipelines and pipeline facilities and natural gas master metered pipelines and pipeline facilities subject to the Commission's pipeline safety jurisdiction under Texas Utilities Code, Chapter 121. The total amount of revenue estimated to be collected under this section does not exceed the amount the Commission estimates to be necessary to recover the costs of administering the pipeline safety program under Texas Utilities Code, Chapter 121, excluding costs that are fully funded by federal sources for [ , or ] any fiscal year.

(b) The Commission hereby assesses each investor-owned natural gas distribution system and each municipally owned natural gas distribution system an annual pipeline safety program fee of $0.37 for each service (service line) reported to be in service at the end of calendar year 2004 [ 2003 ] by each system operator on the Distribution Annual Report, Form F7100.1-1, to be filed on March 15, 2005 [ 2004 ].

(1) Each operator of an investor-owned natural gas distribution system and each operator of a municipally-owned natural gas distribution system shall calculate the total amount of the annual pipeline safety program fee to be paid to the Commission by multiplying the number of services listed in Part B, Section 3, of Department of Transportation (DOT) Distribution Annual Report, Form F7100.1-1, due to be filed on March 15, 2005 [ 2004 ], by $0.37.

(2) Each operator of an investor-owned natural gas distribution system and each operator of a municipally-owned natural gas distribution system shall remit to the Commission on March 15, 2005 [ 2004 ], the amount calculated under paragraph (1) of this subsection.

(3) Each operator of an investor-owned natural gas distribution system and each operator of a municipally-owned natural gas distribution system shall recover, by a surcharge to its existing rates, the amount the operator paid to the Commission under paragraph (1) of this subsection. The surcharge:

(A) - (B) (No change.)

(C) shall be applied in the billing cycle or cycles immediately following the date on which the operator paid the Commission; [ and ]

(D) shall not exceed $0.50 per service or service line ; and [ . ]

(E) shall not be billed to a state agency, as that term is defined in Texas Utilities Code, §101.003.

(4) - (6) (No change.)

(c) - (d) (No change.)

§8.210.Reports.

(a) Accident, leak, or incident report.

(1) - (3) (No change.)

(4) Written report.

(A) Following the initial telephonic report for accidents, leaks, or incidents described in paragraph (1) [ (1)(A) and (E) ] of this subsection, the operator who made the telephonic report shall submit to the Commission a written report summarizing the accident or incident. The report shall be submitted as soon as practicable within 30 calendar days after the date of the telephonic report. The written report shall be made in duplicate on forms supplied by the Department of Transportation. The Division shall forward one copy to the Department of Transportation.

(B) - (D) (No change.)

(b) - (d) (No change.)

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on February 8, 2005.

TRD-200500587

Mary Ross McDonald

Managing Director

Railroad Commission of Texas

Earliest possible date of adoption: March 27, 2005

For further information, please call: (512) 475-1295


Part 2. PUBLIC UTILITY COMMISSION OF TEXAS

Chapter 26. SUBSTANTIVE RULES APPLICABLE TO TELECOMMUNICATIONS SERVICE PROVIDERS

Subchapter C. QUALITY OF SERVICE

16 TAC §26.54

The Public Utility Commission of Texas (commission) proposes an amendment to §26.54, specifically §26.54(c)(2) and (c)(6)(A) relating to service quality objectives, such as operator-handled calls and customer trouble report rates. The proposed amendment is intended to alter performance benchmarks for dominant carriers in order to have a meaningful and attainable standard in changing telecommunications market conditions. Project Number 29897 is assigned to this proceeding.

Katherine Farrell, Staff Attorney, Legal and Enforcement Division, and Nara Srinivasa, Director of the Network Analysis Section, Telecommunications Division, have determined that for each year of the first five-year period the proposed section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section.

Ms. Farrell and Mr. Srinivasa have determined that for each year of the first five years the proposed section is in effect the public benefit anticipated as a result of enforcing the section will be to ensure that the customers are provided a reasonable level of service in an evolving competitive environment.

Ms. Farrell and Mr. Srinivasa have determined that for each year of the first five years the proposed section is in effect there will be no adverse economic effect on small businesses or micro-businesses as a result of enforcing this section. There may be economic costs to persons who are required to comply with the proposed section. These costs are the result of altering internal company guidelines, are likely to vary from business to business, and are difficult to ascertain. However, Staff believes that the benefits accruing from implementation of the proposed section will outweigh these costs.

Ms. Farrell and Mr. Srinivasa have also determined that for each year of the first five years the proposed section is in effect there should be no effect on a local economy, and therefore no local employment impact statement is required under Administrative Procedure Act (APA), Texas Government Code §2001.022.

The commission staff will conduct a public hearing on this rulemaking, if requested pursuant to the Administrative Procedure Act, Texas Government Code §2001.029, at the commission's offices located in the William B. Travis Building, 1701 North Congress Avenue, Austin, Texas 78701 on Friday, April 1, 2005. The request for a public hearing must be received within 30 days after publication.

Comments on the proposed amendment may be submitted to the Filing Clerk, Public Utility Commission of Texas, 1701 North Congress Avenue, P.O. Box 13326, Austin, Texas 78711-3326, within 30 days after publication. Sixteen copies of comments to the proposed amendment are required to be filed pursuant to §22.71(c) of this title. Reply comments may be submitted within 45 days after publication. Comments should be organized in a manner consistent with the organization of the proposed rule(s). The commission invites specific comments regarding the costs associated with, and benefits that will be gained by, implementation of the proposed section. The commission will consider the costs and benefits in deciding whether to adopt the section. All comments should refer to Project Number 29897.

This amendment is proposed under the Public Utility Regulatory Act, Texas Utilities Code Annotated §14.002 (Vernon 1998, Supplement 2005) (PURA), which provides the Public Utility Commission with the authority to make and enforce rules reasonably required in the exercise of its powers and jurisdiction.

Cross Reference to Statutes: Public Utility Regulatory Act §§14.002, 55.001, 55.002, and 55.003.

§26.54.Service Objectives and Performance Benchmarks.

(a) - (b) (No change.)

(c) The DCTU shall comply with the service quality objectives established below in providing the basic telecommunications service to its end-use customers. The DCTU shall file its service quality performance report on a quarterly basis. The report shall include its monthly performance for each category of performance objective and a summary of its corrective action plan for each exchange in which the performance falls below the benchmark. Additionally, the corrective action plan shall include, at a minimum, details outlining how the needed improvements will be implemented within three months and result in performance at or above the applicable benchmark.

(1) (No change.)

(2) Operator-handled calls. DCTUs shall maintain adequate personnel to provide an average operator answering performance as follows for each exchange on a monthly basis:

(A) Eighty-five percent of toll and assistance operator calls answered within ten seconds, or average answer time shall not exceed 3.3 seconds. Benchmark for Corrective Action: If the performance is either below 85% within ten seconds , [ ( ]or if the average exceeds 3.3 seconds[ ) ] at any answering location in [ for a period of four days within ] any given month, the DCTU shall provide a detailed corrective action plan for such exchange or wirecenter.

(B) Ninety percent of repair service calls[ , calls to the business office, and other calls ] shall be answered within 20 seconds or average answer time shall not exceed 5.9 seconds. Benchmark for Corrective Action: If the performance is either below 90% within 20 seconds , or if the average answer time exceeds 5.9 seconds at any answering location for a period of five days within any given month, the DCTU shall provide a detailed corrective action plan for such exchange or wirecenter.

(C) Eighty-five percent of directory assistance calls shall be answered within ten seconds or the average answer time shall not exceed 5.9 seconds. Benchmark for Corrective Action: If the performance is either below 85% within ten seconds , or if the average answer time exceeds 5.9 seconds at any answering location in [ for a period of four days within ] any given month, the DCTU shall provide a detailed corrective action plan for such exchange or wirecenter.

(D) - (E) (No change.)

(3) - (5) (No change.)

(6) Customer trouble reports.

(A) The DCTU shall maintain its network service in a manner that it receives no more than three customer trouble reports on a company-wide basis , excluding customer premises equipment (CPE) reports, per 100 customer access lines per month (on average). Performance Benchmark Applicable for Corrective Action: If the customer trouble report exceeds 3.0% (three per 100 access lines) for a large exchange or 6.0% (6 per 100 access lines) for a smaller exchange for three consecutive months [ three per 100 access lines per month per exchange for a period of three consecutive months ], the DCTU shall provide a detailed corrective action plan for such exchange or wirecenter. For purposes of this section, a large exchange is defined as serving 10,000 or more access lines and a small exchange is defined as serving less than 10,000 access lines.

(B) - (D) (No change.)

(7) (No change.)

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on February 10, 2005.

TRD-200500604

Adriana A. Gonzales

Rules Coordinator

Public Utility Commission of Texas

Earliest possible date of adoption: March 27, 2005

For further information, please call: (512) 936-7223


Part 4. TEXAS DEPARTMENT OF LICENSING AND REGULATION

Chapter 66. REGISTRATION OF PROPERTY TAX CONSULTANTS

16 TAC §66.80, §66.82

The Texas Department of Licensing and Regulation ("Department") proposes amendments to 16 Texas Administrative Code §66.80 and §66.82, regarding fees in the registration of property tax consultants program.

The amendment to §66.80 proposes to lower the original application fee for a property tax consultant from $100 to $50 and the original application fee for a senior property tax consultant from $150 to $75. The amendment to §66.82 proposes to lower the fee for issuing a duplicate registration from $50 to $25. Texas Occupations Code, §51.202 requires the Department to set fees in amounts reasonable and necessary to cover the costs of administering programs under its jurisdiction. The Department conducted its annual fee review pursuant to §51.202 and recommended to the Texas Commission of Licensing and Regulation ("Commission") that the referenced fees be reduced as indicated. The revenue generated by current fees exceeds the amount required by the Department to cover costs of administering the property tax consultants program. On August 9, 2004, the Commission directed the Department to initiate the recommended fee reductions.

William H. Kuntz, Jr., Executive Director, has determined that for the first five-year period the proposed amendments are in effect there will be no cost to state or local government as a result of enforcing or administering the amended sections.

Mr. Kuntz also has determined that for each year of the first five-year period the amendments are in effect, the public benefit will be lower application fees.

The Department anticipates decreased economic costs to licensees, small businesses, micro-businesses, or other persons who are required to comply with the amendments as proposed because of the proposed fee reductions.

Comments on the proposal may be submitted to William H. Kuntz, Jr., Executive Director, Texas Department of Licensing and Regulation, P.O. Box 12157, Austin, Texas 78711, or facsimile (512) 475-3032, or electronically: whkuntz@license.state.tx.us. The deadline for comments is 30 days after publication in the Texas Register .

The amendments are proposed under Texas Occupations Code, Chapter 1152 and Chapter 51, §§51.201, 51.202, and 51.203 which authorizes the Department to adopt rules as necessary to implement this chapter and any other law establishing a program regulated by the Department and which requires the Commission to set fees in amounts reasonable and necessary to cover the costs of administering Department programs.

The statutory provisions affected by the proposal are those set forth in Texas Occupations Code, Chapter 1152 and Chapter 51. No other statutes, articles, or codes are affected by the proposal.

§66.80.Fees.

(a) The non-refundable original application fee for a property tax consultant is $50 [ $100 ].

(b) The non-refundable original application fee for a senior property tax consultant is $75 [ $150 ].

(c) - (g) (No change.)

§66.82.Fees--Duplicate Registration.

A $25 [ $50 ] fee will be charged for issuing a duplicate registration.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on February 7, 2005.

TRD-200500570

William H. Kuntz, Jr.

Executive Director

Texas Department of Licensing and Regulation

Earliest possible date of adoption: March 27, 2005

For further information, please call: (512) 463-7348


Chapter 70. INDUSTRIALIZED HOUSING AND BUILDINGS

16 TAC §§70.10, 70.70, 70.74, 70.101, 70.102

The Texas Department of Licensing and Regulation ("Department") proposes amendments to existing rules at 16 Texas Administrative Code, §§70.10, 70.70, 70.74, 70.101, and 70.102 regarding industrialized buildings. The rules as proposed were approved by the Texas Industrialized Building Code Council. The rules are necessary to provide clarification in terminology, update references to various codes, and update the recertification process for industrialized buildings.

The amendment to §70.10 is necessary to add the definition of "construction documents," which is a term that will be used in the rules for greater consistency and clarity.

The amendment to §70.70(c)(9) is necessary to refer to the correct article of the National Electrical Code.

The term "plans and specifications" has been replaced with the term "construction documents" throughout rule §70.74. The amendment to §70.74(c) clarifies that "ordinary" repairs shall not be considered alterations. The amendment to §70.74(d) clarifies that alteration decals are used to recertify industrialized buildings designed to be moved from one commercial site to another commercial site. The amendment to §70.74(e)(1) does not permit an industrialized builder or installation permit holder to change the design review agency (DRA) used to review and approve alteration construction documents without approval from the Department and sets record retention requirements for all records pertinent to the alterations.

The amendments to §70.74(f) accomplish the following: clarify that only industrialized buildings designed to be moved and that were previously certified under the Texas Industrialized Housing and Building (IHB) program may be recertified, require that a copy of the original data plate be submitted to the DRA with the alteration construction documents submitted for review and approval, clarify that repairs other than ordinary repairs are considered alterations, specify that the industrialized builder purchases alteration decals from the Department to affix to recertified modules, and specify that the alteration decals shall only be released to the third party inspection agency responsible for the alteration inspections. Additional amendments to §70.74(f) define the types of industrialized buildings that may be recertified and the approval and inspection process for recertifying these buildings. The amendments to §70.74(f)(1) specify the requirements for recertification class 1, which applies to buildings that have not been previously altered and for which original approved construction documents exist. Section 70.74(f)(2) specifies the requirements for recertification class 2 buildings where original approved construction documents do not exist. Section 70.74(f)(3) specifies the requirements for recertification class 3 buildings where original approved construction documents exist, but the building has been altered from those documents. Section 70.74(f)(4) specifies the requirements for recertification class 4 buildings that have been previously recertified. Section 70.74(f)(5) specifies the requirements for recertifying a building where emergency repairs (that do not qualify as ordinary repairs) to the building are necessary. Section 70.74(f)(6) specifies the plan approval requirements for recertification construction documents and requires the use of the Council's stamp of approval for altered or recertified buildings. Section 70.74(f)(7) sets the inspection requirements for recertifying industrialized buildings. The amendments to §70.74(g) clarify that the data plate is for recertification and alterations of industrialized housing and buildings.

The amendments to §70.101(d) amend section 101.2 of the International Building Code (IBC) to require that alterations be reviewed for compliance with the International Existing Building Code (IEBC). Section 70.101(i) amends the 2003 IEBC to replace the accessibility standards referenced in this code with the Texas Accessibility Standards, to delete chapter 10 (Historic Buildings) as not relevant, and to amend section 1201.2 to apply to structures existing prior to July 1, 2004 (adoption date of 2003 codes).

The amendments to §70.102 require compliance with the mandatory building codes for new buildings for a building that has not been previously occupied or used for its intended purpose and compliance with the 2003 IEBC for recertification of existing industrialized buildings.

William H. Kuntz, Jr., Executive Director, has determined that for the first five-year period the proposed amendments are in effect there may be some additional costs to the Department in implementing and enforcing the rules. The Department may be required to conduct additional plan reviews, inspections, and builder audits. It is anticipated that any additional costs will not be substantial and can be absorbed within existing budget constraints. It is not anticipated that there will be any fiscal implications to local government.

Mr. Kuntz also has determined that for each year of the first five-year period the amendments are in effect, the public benefit will be increased safety of industrialized buildings. In addition, the incorporation of the IEBC into the rules likely will encourage greater use of existing industrialized buildings, without compromising public safety.

Mr. Kuntz also has determined that for each year of the first five-year period the amendments are in effect, there may be some economic costs to persons required to comply with the amended rules. This is because the rules are likely to increase the number of recertifications of existing buildings, and there would be a cost to the builder to go through the recertification process. Under current rules, recertification has been a little-used procedure. For the same reason, there could also be some additional costs to small or micro-businesses in the industrialized building industry. However, it is anticipated that the rules will lower compliance costs, including costs to small and micro-businesses, from the incorporation of the IEBC into the rules. The IEBC is designed to encourage the use and re-use of existing buildings by setting reasonable requirements for alterations of existing buildings that are more predictable and consistent than the requirements of the IBC. The Department is unable to provide a precise estimate of these economic effects.

Comments on the proposal may be submitted to William H. Kuntz, Jr., Executive Director, Texas Department of Licensing and Regulation, P.O. Box 12157, Austin, Texas 78711, or facsimile 512/475-3032, or electronically: whkuntz@license.state.tx.us. The deadline for comments is 30 days after publication in the Texas Register .

The amendments are proposed under Texas Occupations Code, Chapter 51, which authorizes the Department to adopt rules as necessary to implement this chapter and any other law establishing a program regulated by the Department, and Texas Occupations Code, Chapter 1202.

The statutory provisions affected by the proposal are those set forth in Texas Occupations Code, Chapter 51 and Chapter 1202. No other statutes, articles, or codes are affected by the proposal.

§70.10.Definitions.

(a) The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise.

(1) Alteration--Any construction, other than ordinary repairs of the house or building, to an existing industrialized house or building after affixing of the decal by the manufacturer. Industrialized housing or buildings that have not been maintained shall be considered altered.

(2) Alteration decal--The approved form of certification issued by the department to an industrialized builder to be permanently affixed to a module indicating that alterations to the industrialized building module have been constructed to meet or exceed the code requirements and in compliance with this chapter.

(3) Building site--A lot, the entire tract, subdivision, or parcel of land on which industrialized housing or buildings are sited.

(4) Building system--The design and/or method of assembly of modules or modular components represented in the plans, specifications, and other documentation which may include structural, electrical, mechanical, plumbing, fire protection, and other systems affecting health and safety.

(5) Chapter 1202--Texas Occupations Code, Chapter 1202, Industrialized Housing and Buildings.

(6) Closed construction--That condition where any industrialized housing or building, modular component, or portion thereof is manufactured in such a manner that all portions cannot be readily inspected at the site without disassembly or destruction thereof.

(7) Commercial structure--An industrialized building classified by the mandatory building codes for occupancy and use groups other than residential for one or more families. The term shall not include a structure that is not installed on a permanent foundation and either is not open to the public or is less than 1,500 square feet in total area and not used as a school or place of religious worship.

(8) Compliance Control Program--The manufacturer's system, documentation, and methods of assuring that industrialized housing, buildings, and modular components, including their manufacture, storage, handling, and transportation conform with Chapter 1202 and this chapter.

(9) Construction documents--The aggregate of all plans, specifications, calculations, and other documentation required to be submitted to the design review agency for compliance review to the mandatory building code.

(10) [ (9) ] Component--A sub-assembly, subsystem, or combination of elements for use as a part of a building system or part of a modular component that is not structurally independent, but may be part of structural, plumbing, mechanical, electrical, fire protection, or other systems affecting life safety.

(11) [ (10) ] Decal--The approved form of certification issued by the department to the manufacturer to be permanently affixed to the module indicating that it has been constructed to meet or exceed the code requirements and in compliance with this chapter.

(12) [ (11) ] Design package--The aggregate of all plans, designs, specifications, and documentation required by these sections to be submitted by the manufacturer to the design review agency, or required by the design review agency for compliance review, including the compliance control manual and the on-site construction documentation. Unique or site specific foundation drawings and special on-site construction details prepared for specific projects are not a part of the design package except as expressly set forth in §70.74.

(13) [ (12) ] Design review agency--An approved organization, private or public, determined by the council to be qualified by reason of facilities, personnel, experience, demonstrated reliability to review designs, plans, specifications, and building systems documentation, and to certify compliance to these sections evidenced by affixing the council's stamp. Chapter 1202 designates the department as a design review agency.

(14) [ (13) ] ICC--International Code Council, Inc., 5203 Leesburg Pike, Suite 708, Falls Church, Virginia 22041-3401.

(15) [ (14) ] Industrialized builder--A person who is engaged in the assembly, connection, and on-site construction and erection of modules or modular components at the building site or who is engaged in the purchase of industrialized housing or buildings or of modules or modular components from a manufacturer for sale or lease to the public; a subcontractor of an industrialized builder is not a builder for purposes of this chapter.

(16) [ (15) ] Insignia--The approved form of certification issued by the department to the manufacturer to be permanently affixed to the modular component indicating that it has been constructed to meet or exceed the code requirements and in compliance with the sections in this chapter.

(17) [ (16) ] Installation--On-site construction (see paragraph (26) of this section).

(18) [ (17) ] Installation permit--A registration issued by the department to a person who purchases an industrialized house or building for his/her own use and who assumes responsibility for the installation of the industrialized house or building. A person who applies for an installation permit may not be engaged in the purchase of industrialized housing or buildings or of modules or modular components for sale or lease to the public. A subcontractor of an installation permit holder is not an industrialized builder for the purposes of this chapter.

(19) [ (18) ] Lease, or offer to lease--A contract or other instrument by which a person grants to another the right to possess and use industrialized housing or buildings for a specified period of time in exchange for payment of a stipulated price.

(20) [ (19) ] Local building official--The agency or department of a municipality or other local political subdivision with authority to make inspections and to enforce the laws, ordinances, and regulations applicable to the construction, alteration, or repair of residential and commercial structures.

(21) [ (20) ] Manufacturer--A person who constructs or assembles modules or modular components at a manufacturing facility which are offered for sale or lease, sold or leased, or otherwise used.

(22) [ (21) ] Manufacturing facility--The place other than the building site, at which machinery, equipment, and other capital goods are assembled and operated for the purpose of making, fabricating, constructing, forming, or assembly of industrialized housing, buildings, modules, or modular components.

(23) [ (22) ] Model--A specific design of an industrialized house, building, or modular component which is based on size, room arrangement, method of construction, location, arrangement, or size of plumbing, mechanical, or electrical equipment and systems therein in accordance with an approved design package.

(24) [ (23) ] Module--A three dimensional section of industrialized housing or buildings, designed and approved to be transported as a single section independent of other sections, to a site for on-site construction with or without other modules or modular components.

(25) [ (24) ] NFPA--National Fire Protection Association, Batterymarch Park, Quincy, Massachusetts 02269.

(26) [ (25) ] Nonsite specific building--An industrialized house or building for which the permanent site location is unknown at the time of construction.

(27) [ (26) ] On-site construction--Preparation of the site, foundation construction, assembly and connection of the modules or modular components, affixing the structure to the permanent foundation, connecting the structures together, completing all site-related construction in accordance with designs, plans, specifications, and on-site construction documentation.

(28) [ (27) ] Open construction--That condition where any house, building, or portion thereof is constructed in such a manner that all parts or processes of manufacture can be readily inspected at the building site without disassembly, damage to, or destruction thereof.

(29) [ (28) ] Permanent foundation system--A foundation system for industrialized housing or buildings designed to meet the applicable building code as set forth in §§70.100, 70.101, and 70.102.

(30) [ (29) ] Permanent industrialized building--An industrialized building that is not designed to be transported from one commercial site to another commercial site.

(31) [ (30) ] Person--An individual, partnership, company, corporation, association, or any other legal entity, however organized.

(32) [ (31) ] Price--The quantity of an item that is exchanged or demanded in the sale or lease for another.

(33) [ (32) ] Public--The people of the state as a whole to include individuals, companies, corporations, associations or other groups, however organized, and governmental agencies.

(34) [ (33) ] Registrant--A person who, or which, is registered with the department pursuant to the rules of this chapter as a manufacturer, builder, design review agency, third party inspection agency, or third party inspector.

(35) [ (34) ] Residential structure--Industrialized housing designed for occupancy and use as a residence by one or more families.

(36) [ (35) ] Sale, sell, offer to sell, or offer for sale--Includes any contract of sale or other instrument of transfer of ownership of property, or solicitation to offer to sell or otherwise transfer ownership of property.

(37) [ (36) ] Site or building site--A lot, the entire tract, subdivision, or parcel of land on which industrialized housing or buildings are sited.

(38) [ (37) ] Special conditions and/or limitations--On-site construction documentation which alerts the local building official of items, such as handicapped accessibility or placement of the building on the property, which may need to be verified by the local building official for conformance to the mandatory building codes.

(39) [ (38) ] Structure--An industrialized house or building that results from the complete assemblage of the modules or modular components designed to be used together to form a completed unit.

(40) [ (39) ] Third party inspector--An approved person or agency, private or public, determined by the council to be qualified by reason of facilities, personnel, experience, demonstrated reliability, and independence of judgment to inspect industrialized housing, buildings, and portions thereof for compliance with the approved plans, documentation, compliance control program, and applicable code.

(b) Other definitions may be set forth in the text of the sections in this chapter. For purposes of these sections, the singular means the plural, and the plural means the singular.

(c) Where terms are not defined in this section or in other sections in this chapter and are defined in the mandatory building codes as referenced in §70.100, such terms shall have the meanings ascribed to them in these codes unless the context as the term is used clearly indicates otherwise. Where terms are not defined in this section or other sections in this title or in the mandatory building codes, such terms shall have ordinarily accepted meanings such as the context implies.

§70.70.Responsibilities of the Registrants--Manufacturer's Design Package.

(a) Review and approval. The manufacturer's design package must be reviewed and approved in accordance with the following.

(1) The manufacturer must select a council approved design review agency (DRA) to perform all required review and evaluation of plans, designs, specifications, compliance control, and on-site construction documentation, etc. This selection shall be made in writing to the executive director and will state the name, address, and registration number of the design review agency selected.

(2) An approved DRA shall review all designs, plans, specifications, calculations, compliance control programs, on-site construction documentation or specifications, and other documents as necessary to assure compliance with the mandatory building codes in accordance with the interpretations, instructions, and determinations of the council. The reviews are to be performed or directly supervised by the DRA's certified plans reviewers for the discipline (electrical, plumbing, mechanical, structural, building planning, or fire safety) as listed and approved in the agency's organizational chart. A DRA's plans reviewers must be certified pursuant to the criteria established by the council as set forth in §70.22. The department or DRA will obtain from the manufacturer such information as is necessary to assure that the manufacturer's designs and procedures are in compliance with the mandatory building codes and the sections in this chapter.

(3) All documents shall have all pages numbered and arranged in accordance with a table of contents. The floor plans shall have no scale smaller than 1/8th inch equals one foot. All documents shall be identified to indicate the manufacturer's name and address.

(4) The DRA will signify approval of a drawing, specification, calculation, or any other document in the manufacturer's design package by applying the council's stamp to each page. An alternate council stamp as approved by the council may be used on all designs, plans, specifications, calculations, and other documentation with the exception of the first or cover page and the table of contents or index pages of the design package. The original council stamp with original signature will be required on these pages. The signature on the original council stamp must be the signature of the manager or chief executive officer of the DRA. The manager or chief executive officer of the DRA must be licensed in the State of Texas as a professional engineer or architect in accordance with the criteria for approval of DRA's established by the council. The stamp shall not be placed on any designs, plans, or specifications which do not meet the requirements of the applicable mandatory building codes or the requirements of these sections. The manufacturer and the DRA shall keep copies of the approved documents. The manufacturer shall keep a copy of all approved documents for a minimum of ten years from the date the last unit constructed from the documents is shipped and make a copy of these documents available to the Department upon request. The DRA shall keep a copy on file of all approved documents for a minimum of five years from the date that these documents are superseded by adoption of later editions of the mandatory building codes and make a copy of these documents available to the Department upon request. The manufacturer shall make a copy available to the person performing in-plant inspections. A DRA will forward one approved copy of the design package, including additions and revisions, to the department within five days of approval and will return one approved copy to the manufacturer.

(5) Approvals dated before the effective date of the adoption of the codes in §70.100 are not valid for industrialized housing, buildings, modules, and modular components constructed after the effective date of adoption unless steps are taken to transition the approval to the new code editions in accordance with subparagraphs (B) and (C) of this paragraph. Manufacturers will be notified of the change in code editions 180 days before the effective date of the change. Manufacturers who wish to continue building to previously approved documents must resubmit these documents to their DRA for review and approval to the new code editions. Approval of these documents will be evidenced by application of a new approval date and the council's stamp of approval to each document. The manufacturer may make the transition from current code edition to new code edition in any of the following ways.

(A) The approval date on all documents in the manufacturer's design package will be on or after the effective date of adoption of the new edition of the codes in §70.100.

(B) The manufacturer may transition approval of documents in his design package any time within the 180 days prior to the effective date of the adoption of the new editions of the codes. The manufacturer must notify the department in writing of the effective date of transition. All documents approved on or after that date shall be to the new editions of the codes. All previously approved supporting documentation, such as compliance control manuals, system calculations, etc., must be resubmitted to the DRA for review and approval to the new code editions and must be approved as of the effective date of transition specified by the manufacturer.

(C) The manufacturer may submit a written description of any other method of transition to the department for approval.

(6) A DRA may withdraw the approval of any document whenever the approval is later found to be in violation of code requirements or the rules and regulations in this chapter. Notice of the withdrawal of the approval shall be in writing and shall set forth the reasons for the withdrawal. Any withdrawal of approval shall have prospective effect only, except for life safety items.

(7) The DRA shall reimburse the department an hourly monitoring fee for expenses incurred outside headquarters in monitoring the performance of the DRA.

(8) DRAs or the department acting as a DRA may make red ink corrections to documents provided the corrections meet all of the following criteria:

(A) limited to corrections of minor deviations;

(B) the corrected items can be verified by reference to prescriptive code requirements;

(C) the change does not involve any change of design or require design;

(D) the red ink correction is valid for 10 working days and may not be extended; and

(E) the corrections must be numbered and initialed by the DRA and the statement, "As noted with (number) corrections" shall appear near the stamp of the council with the number of corrections entered.

(b) In-plant documentation. The manufacturer shall provide the DRA in-plant documentation that must, at the minimum, contain the following:

(1) specifications or detail drawings for all materials, devices, appliances, equipment, and fasteners used in construction;

(2) detailed drawings of all assemblies and components (with cross-sections as necessary to identify major building components);

(3) floor plans for all models and options;

(4) electrical schematics for all models and options;

(5) water system and drain-waste-vent system drawings for all models and options;

(6) gas piping system drawings for all models and options;

(7) mechanical system drawings for all models and options;

(8) fire protection, fire safety, and exit details;

(9) thermal resistance details;

(10) heating, ventilation, and air conditioning details;

(11) structural, thermal, and electrical load calculations;

(12) weather resistance details;

(13) condensation protection details;

(14) decay protection details;

(15) insect and vermin protection details;

(16) fastening schedule;

(17) assembly and connection instructions for all components, materials, devices, equipment, and appliances;

(18) on the floor plan or on the cover or title sheet for each model or project in a title block format:

(A) name and date of applicable codes;

(B) identification of permissible type of gas for appliances;

(C) maximum snow load (roof)(psf);

(D) maximum wind speed (mph) and exposure;

(E) seismic design criteria;

(F) occupancy/use group type;

(G) construction type;

(H) special conditions and/or limitations;

(I) the location of the data plate on the building or dwelling unit; and

(J) the location of the decal or insignia on each module or modular component;

(19) compliance control manual (reference subsection (c) of this section); and

(20) on-site construction documentation (reference subsection (d) of this section).

(c) Compliance control program. The utilization of mass production techniques and assembly line methods in the construction of industrialized housing, buildings, modules, and modular components along with the fact that a large part of such construction cannot be inspected at the ultimate building site, requires manufacturers to develop an adequate compliance control program to assure that these structures meet or exceed mandatory code requirements and are in compliance with the rules and regulations of this chapter. The compliance control program shall be documented in the form of a manual that must be approved by the design review agency or the department. The council may waive the compliance control program as set forth in the rules upon written request from the manufacturer. Waiver of the compliance control program shall require that each module or modular component be individually inspected at each and every stage of the manufacturing process. The manufacturer shall provide the design review agency a compliance control manual that must, at the minimum, contain the following:

(1) a table of contents;

(2) a chart indicating the manufacturer's organizational structure to assure compliance and to assure that the compliance control staff shall maintain independence from the production personnel;

(3) a statement that defines the obligation, responsibility, and authority for the manufacturer's compliance control program;

(4) identification of compliance control personnel, their accountability by position, responsibility for inspections, method of marking nonconformances observed, and system for assuring corrections are made;

(5) materials handling methods, including inspection checklists, for receiving materials and methods for marking and removing rejected materials both upon receipt and from the production line. The area for rejected materials must be clearly indicated to assure that such material is not used;

(6) a description of an identification system to mark each individual module, or modular component, at the first stage of production to assure appropriate inspection and rechecking of any deviation corrections;

(7) a diagram of the manufacturing sequence with the plant layout, including a description of the activities to be performed along with a listing of those that may be performed at one or more stations;

(8) an inspection checklist including:

(A) a list of inspections to be made at each production station; and

(B) accept/reject criteria (each significant dimension and component should be given tolerances);

(C) an energy compliance checklist that enumerates the energy code-compliance features of the module or modules and includes a signature space for the compliance control inspector or manager. A copy of this checklist shall be shipped with the module or modules.

(9) step-by-step test procedures, a description of the station at which each production test is performed, a description of required testing equipment, and procedures for periodic checking, recalibration, and readjustment of test equipment. Procedures shall be included for, but not limited to, electrical tests as specified in the National Electrical Code, Article [ 550-12 ] 550.17 , gas supply pressure tests, water supply pressure tests, drain-waste-vent system tests, concrete slump tests, and concrete strength tests;

(10) storage procedures for completed structures at the plant and for any other locations prior to installation;

(11) a statement indicating the person who is responsible for compliance control at each manufacturing facility and who will assume responsibility for decals and insignia, application of the decals and insignia, and the reporting procedure;

(12) a procedure for maintaining reliable, retrievable records of the inspections performed, decal and insignia numbers assigned, the deficiencies and how they were corrected, and the site to which the modules or modular components were transported;

(13) procedures and information to demonstrate how the modules and modular components are to be transported to the building site so that damage will not occur or that compliance deviations will not result (actual transportation without damage or deviation is evidence sufficient to justify the method); and

(14) procedures that assure that the compliance control procedures are complied with on all regulated structures. As a minimum, regulated structures must be identified prior to commencing construction.

(d) On-site construction specifications or documentation. All work to be performed on the building site shall be specifically identified and distinguished from construction to be performed in the manufacturing facility, e.g., assembly and connection of all modules, modular components, systems, equipment, and appliances and attachment to the foundation system. The work to be performed on-site shall be described in detail in documents (architectural sheets, specifications, instructions, etc.) which shall be made available to the builder for use at the site and provided as required for review and inspection to the agency having local authority. The manufacturer shall provide the design review agency on-site construction documentation which must, at the minimum, contain the following:

(1) foundation system designs for all models in accordance with the applicable mandatory building code;

(2) details for module to module or modular component assembly and connection;

(3) details for connection and attachment of all modules and modular components to the foundation system;

(4) firestopping and draftstopping details;

(5) details for fire exits, balconies, walkways, and other site-built attachments;

(6) exterior weatherproofing details;

(7) details for thermal, condensation, decay, corrosion, and insect protection;

(8) electrical, mechanical, heating, cooling, and plumbing system completion details;

(9) electrical, mechanical, heating, cooling, and plumbing system test procedures;

(10) fire safety provisions; and

(11) specifications and instructions for cooling equipment, and complete information necessary to calculate sensible heat gain along with information on the sizing of the air distribution system, if applicable, and the R values of insulation in the ceiling, walls, and floors.

(e) Unique on-site details. If the typical foundation drawing in the on-site construction documentation is not suitable for a specific site, or if the structure is only partially constructed of modular components, or if the industrialized builder will add unique on-site details, a licensed Texas professional engineer (or architect for one and two family dwellings or buildings having one story and total floor area of 5,000 square feet or less) shall design and stamp the unique foundation drawings or on-site details and review by a DRA is not needed or required.

(f) Non-site specific buildings. Whenever the manufacturer does not know, at the time of construction, where the building is to be placed, in lieu of providing the site specific construction details or typical site construction details as required in subsection (d) of this section, the manufacturer may provide special conditions and/or limitations on the placement of the building. These special conditions and/or limitations will serve to alert the local building official of items, such as handicapped accessibility and placement of the building on the property, which the local building official may need to verify for conformance to the mandatory building codes. Certain site-related details, such as module to module connections, must still be provided by the manufacturer. It is the responsibility of the DRA to verify that such site-related details are included in the manufacturer's approved design package.

§70.74.Responsibilities of the Registrants--Alterations.

(a) The manufacturer shall not alter construction of the industrialized house or building from the approved design package. Industrialized builders or installation permit holders shall not alter construction performed at the installation site from the approved on-site construction documentation except in accordance with this section or §70.70(e). Alterations of industrialized housing or buildings shall be as specified in this section.

(b) An alteration of an industrialized house or building prior to, or during installation, that results in a structure that does not comply with the mandatory building codes is prohibited. An alteration after installation of an industrialized building that is designed to be moved from one commercial site to another commercial site that does not comply with the mandatory building codes is prohibited. Alterations after installation of industrialized housing or permanent industrialized buildings shall be in accordance with the requirements of the local building code authorities.

(c) Ordinary repairs [ Repairs ] and work exempt from permit requirements as specified in the mandatory building codes referenced in §70.100 and §70.101 shall not be considered alterations. Ordinary repairs shall include the removal and replacement of the covering of existing materials, elements, equipment, or fixtures using like or the same new materials, elements, equipment, or fixtures that serve the same purpose.

(d) Alteration decals are used to recertify [ certify alterations of ] industrialized buildings designed to be moved from one commercial site to another commercial site . Each decal is assigned to a specific module or modular component. The control of the decals shall remain with the department. The department will issue alteration decals to the third party inspection agency responsible for the inspections of the alterations upon application and payment of the fee for the decal by the industrialized builder. By affixing the decal the industrialized builder and third party inspection agency certify that the module has been altered and inspected in accordance with the mandatory building codes and this section. The third party inspector shall not affix the decal to any module where inspection reveals that the building [ alteration ] does not comply with the approved recertification or alteration construction documents [ plans and specifications ] or the mandatory building codes.

(e) Alterations of industrialized housing and permanent industrialized buildings.

(1) Prior to, or during, installation outside the jurisdiction of a municipality . The industrialized builder, or installation permit holder, shall submit the original approved construction documents [ plans and specifications ] for the house or building, as reference, along with a complete set of construction documents [ plans and specifications ] describing a proposed alteration to a design review agency for approval prior to construction in accordance with the procedures established by the Texas Industrialized Building Code Council. The design review agency responsible for review and approval of alteration construction documents for a project, industrialized house, or permanent industrialized building may not be changed without the written approval of the department. Alterations on the house or building shall not begin prior to approval of the construction documents [ plans and specifications ] and shall be performed only by persons licensed to perform this work. Inspections of alterations shall be performed by a third party inspector in accordance with procedures established by the Texas Industrialized Building Code Council. The third party inspection agency responsible for inspections for a project may not be changed without the written approval of the department. An alteration data plate shall be affixed to any house or building where the alteration results in a reclassification of the occupancy group or construction type, a change in the permissible type of gas required for appliances, or a change in the wind speed and exposure, maximum snow (roof) load, seismic design criteria, or special conditions or limitations. The data plate shall contain such information as specified in subsection (g). All records pertinent to the alteration, including a copy of the alteration data plate, shall be retained by the industrialized builder or installation permit holder for a minimum of 10 [ 5 ] years from the date of successful completion of the final inspection and be made available to the department upon request . All records pertinent to the review and approval of the alteration construction documents shall be retained by the DRA for a minimum of 5 years from the date of approval and shall be made available to the Department upon request. All records pertinent to the alteration inspections shall be retained by the TPIA for a minimum of 5 years from the completion of the alteration construction and inspections and shall be made available to the department upon request. [ ; ]

(2) Prior to installation within the jurisdiction of a municipality . Alterations prior to installation within a jurisdiction shall be in accordance with paragraph (1) of this subsection . [ ; ]

(3) During, or after, installation within the jurisdiction of a municipality . Approval of plans and inspection of alterations shall be in accordance with the permitting and inspection procedures of the municipality.

(f) Recertification [ Alterations ] of industrialized buildings designed to be moved from one commercial site to another commercial site. An industrialized building that has been certified by application of a Texas decal in accordance with §70.77 and that is designed to be moved from one commercial site to another commercial site [ , that is altered, ] may be recertified in accordance with this section. A copy of the data plate on each building to be recertified shall be submitted to the DRA responsible for the plan review and approval of recertification and alteration documents. Repairs, other than ordinary repairs as defined by the mandatory building codes, shall be considered alterations. The industrialized builder shall purchase an alteration decal from the Department to affix to each module that is recertified or altered. The alteration decal shall be released only to the third party inspection agency responsible for the alteration inspections .

(1) Recertification class 1: to recertify a building that is to be altered where original approved construction documents exist and the building has not been previously altered. The [ To recertify the building the ] industrialized builder shall:

(A) provide the design review agency the current value of the building and a cost estimate for the alteration. With knowledge of the penalties for false statements the industrialized builder shall certify that the current value of the building and the cost estimate are true and accurate;

(B) submit a copy of the original approved construction documents for the building to the design review agency for reference purposes;

(C) submit a copy of the construction documents [ plans and specifications ] for alteration of the building to the design review agency for review and approval in accordance with the requirements established by the Texas Industrialized Building Code Council and subsection (f)(6) of this section . The construction documents [ plans and specifications ] shall include the serial number assigned by the manufacturer and the Texas decal number or insignia number of each module or modular component;

(D) not begin construction of the alteration of the building prior to the approval of the construction documents [ alteration plans and specifications ] by the design review agency. Construction [ The alteration ] shall be performed only by persons licensed to perform this work; and

(E) have the construction [ alteration ] inspected by a third-party inspector in accordance with the procedures established by the Texas Industrialized Building Code Council and subsection (f)(7) of this section . [ The industrialized builder may not change the third party inspector for a project once started without the written approval of the department. ] A minimum of one rough in inspection and a final inspection of the alteration construction shall be required [ ; ]

[ (F) maintain all records pertinent to the alteration and make these records available to the Department upon request; and]

[ (G) purchase a decal from the Department to affix to each module. The alteration decal shall be released only to the third party inspection agency responsible for the alteration inspections].

(2) Recertification class 2: to recertify a building where original approved construction documents do not exist. The industrialized builder shall:

(A) have a structural analysis of the existing building made by an engineer licensed to practice in Texas to determine the adequacy of the structural systems in accordance with Chapter 16 of the current edition of the International Building Code adopted in §70.100. The industrialized builder shall submit a copy of this analysis and a set of plans depicting the as built construction of the building to the design review agency for review and approval in accordance with the requirements established by the Texas Industrialized Building Code Council and with subsection (f)(6) of this section. These documents shall include the serial number assigned by the manufacturer and the Texas decal or insignia number of each module or modular component contained in the building;

(B) bring into compliance those areas of the building identified by the structural analysis and the design review agency as not in compliance with the mandatory building code. The industrialized builder shall submit construction documents to bring the building into compliance to the design review agency for review and approval in accordance with the requirements established by the Texas Industrialized Building Code Council and with subsection (f)(6) of this section;

(C) if alterations are planned, then provide the DRA the current value of the building and a cost estimate in accordance with subsection (f)(1)(A) of this section and submit a copy of the construction documents for alteration of the building to the DRA in accordance with subsection (f)(1)(C) of this section;

(D) have the building inspected by a third party inspector in accordance with the procedures established by the Texas Industrialized Building Code Council and subsection (f)(7) of this section to verify that the building complies with the approved as built construction documents;

(E) not begin construction to bring the building into compliance, or to alter the building, prior to approval of the construction documents. The construction shall be performed only by persons licensed to perform this work; and

(F) have the construction to bring the building into compliance, and to alter the building, inspected by a third-party inspector in accordance with the procedures established by the Texas Industrialized Building Code Council and subsection (f)(7) of this section. A minimum of one rough in inspection and a final inspection of the construction shall be required.

(3) Recertification class 3: to recertify a building where original approved construction documents exist, but the building has been altered from those plans and the building has not been recertified in accordance with other paragraphs in this section. The industrialized builder shall:

(A) submit a copy of the original approved construction documents for the building to the design review agency for reference;

(B) submit a copy of construction documents that depict the alterations or repairs to the building to the DRA for review and approval in accordance with the requirements established by the Texas Industrialized Building Code Council and with subsection (f)(6) of this section. Where structural elements have been altered, a structural analysis of the existing building made by an engineer licensed to practice in Texas to determine the adequacy of the structural systems in accordance with Chapter 16 of the current edition of the International Building Code adopted in §70.100 shall also be submitted. The construction documents shall include the serial number assigned by the manufacturer and the Texas decal or insignia number of each module or modular component contained in the building;

(C) if additional alterations are planned, then provide the DRA the current value of the building and a cost estimate in accordance with subsection (f)(1)(A) of this section and submit a copy of the construction documents for alteration of the building to the DRA in accordance with subsection (f)(1)(C) of this section;

(D) bring into compliance those areas of the building identified by the structural analysis or the design review agency as not in compliance with the mandatory building codes. The industrialized builder shall submit construction documents to bring the building into compliance to the design review agency for review and approval in accordance with the requirements established by the Texas Industrialized Building Code Council and with subsection (f)(6) of this section;

(E) have the building inspected by a third party inspector in accordance with the procedures established by the Texas Industrialized Building Code Council and subsection (f)(7) of this section to verify that the building complies with the approved as built construction documents;

(F) not begin construction to bring the building into compliance, or to alter the building, prior to approval of the construction documents. The construction shall be performed only by persons licensed to perform this work; and

(G) have the construction to bring the building into compliance, and to alter the building, inspected by a third-party inspector in accordance with the procedures established by the Texas Industrialized Building Code Council and subsection (f)(7) of this section. A minimum of one rough in inspection and a final inspection of the construction shall be required.

(4) Recertification class 4: buildings that are to be altered again after recertification. The industrialized builder shall:

(A) submit a copy of all previous recertification construction documents, including original and as built construction documents where applicable, to the design review agency in accordance with the requirements established by the Texas Industrialized Building Code Council and subsection (f)(6) of this section;

(B) include the alteration decal numbers from previous recertifications on the construction documents for altering the building; and

(C) comply with subsections (f)(1)(A) and (f)(1)(C) through (f)(1)(E) of this section.

(5) Emergency repairs. Equipment replacement and repairs, which do not qualify as ordinary repairs in accordance with the mandatory building codes, that must be performed in an emergency situation may be performed prior to recertification of the building. The industrialized builder shall submit documents as necessary to recertify the building in accordance with the requirements of subsections (f)(1) through (f)(3) within the next working business day with the following exceptions.

(A) The industrialized builder shall have 10 working days to submit as built construction documents for the entire building where required by the recertification requirements of subsections (f)(1) through (f)(4).

(B) The industrialized builder shall have 10 working days to submit a structural analysis performed by an engineer licensed to work in Texas where required by the recertification requirements of subsection (f)(1) through (f)(4).

(6) The industrialized builder shall choose an approved DRA to perform the review and evaluation of all construction documents for the recertification of an industrialized building. The builder may choose a different DRA for different projects or buildings, but may not change DRA's for a project or building once the plan review has begun without prior written approval from the department. Construction documents submitted to the DRA shall include all information pertinent to assuring compliance with the mandatory building code and shall include structural, thermal, and electrical load calculations. As built construction documents shall be reviewed to determine the existence of any potential nonconformance with the provisions of the mandatory building codes. The review and approval of construction documents to recertify a building shall comply with the requirements of §§70.70(a)(2) through 70.70(a)(4) and 70.70(a)(6) through 70.70(a)(8) with the following exceptions.

(A) Based on the engineering analysis and the DRA's review of the as built construction documents, the DRA will prepare a report to the industrialized builder that describes the nonconformances of the building to be recertified.

(B) The DRA will signify approval of a drawing, specification, calculation, or any other document submitted for review and approval by the application of the council's stamp of approval for altered or recertified buildings.

(C) The design review agency shall complete a recertification transmittal form in accordance with the requirements of the Texas Industrialized Building Code Council and forward a completed copy of the form to the department. A copy of all documents pertinent to the recertification of the building shall be supplied to the department upon request.

(D) The design review agency shall forward a completed copy of the recertification transmittal form and one approved copy of the construction documents to the industrialized builder.

(E) The design review agency shall keep a copy on file of the original approved documents, the engineering analysis, and approved construction documents for recertification of the building for 5 years from the latest date of approval of the recertification or alteration construction documents.

(7) [ (2) ] The third party inspector shall affix the alteration decal to [ the ] each industrialized building module or modular component upon completion of the construction and successful completion of all required inspections in accordance with this section and the requirements of the Texas Industrialized Building Code Council . The decal shall be affixed in the vicinity of the original decal or insignia on the module or modular component as depicted on the approved construction documents. The industrialized builder may not change the third party inspection agency for a project or building once started without prior written approval of the department .

(A) All plans pertinent to the alteration or recertification shall be available for use by the third party inspector during the inspection. A copy of the mandatory building codes shall be available for the inspector's use during the inspection.

(B) A rough-in inspection shall be scheduled by the industrialized builder while construction is still open to inspection. The inspector shall begin the inspection by verifying that the units to be inspected are those depicted in the original approved, the approved as built, or the previously approved recertification construction documents and shall verify the original decal and serial number of each unit to be inspected. The third party inspector may require the industrialized builder to uncover portions of the building as necessary to verify compliance. The inspection shall be terminated and the alteration decals returned to the department if inspection reveals that the units have been altered from the original approved, the approved as built, or the previously approved recertification construction documents. The inspection shall be terminated and the alteration decals returned to the department if inspection reveals that the units are not those identified by serial number and decal number in the approved construction documents.

(C) A final inspection shall be scheduled by the owner or industrialized builder after construction is completed.

(D) Inspection of system testing shall be scheduled by the industrialized builder as necessary to assure that tests required by the mandatory building code are witnessed by the third party inspector.

(E) The industrialized builder shall schedule a reinspection with the third party inspector wherever a deviation from the approved plans is identified that cannot be corrected and inspected during the rough-in or final inspection.

(F) The inspector shall complete a recertification inspection report on the forms and in the format required by the department and the Texas Industrialized Building Code Council. A copy of the inspection report shall be provided to the industrialized builder for his records and submitted to the department upon request. The third party inspection agency shall maintain records of all recertification inspection reports for five years from the date of successful completion of inspections for a building or project.

(G) Only one inspection shall be required where a building is recertified in accordance with subsection (f)(2) or (f)(3) of this section and no construction is required to bring the building into compliance or to complete alterations on the building. The inspector shall verify that the units to be inspected are those depicted in the approved construction documents and shall verify the original decal and serial number of each unit to be inspected. The third party inspector may require the industrialized builder to uncover portions of the building as necessary to verify compliance. The inspection shall be terminated, and the alteration decals returned to the department, if inspection reveals that the units have been altered from the approved construction documents.

(H) Only one inspection shall be required where emergency repairs are performed in accordance with subsection (f)(5) of this section and where further construction is not required to bring the building into compliance with the mandatory building code. The inspector shall verify that the units to be inspected are those depicted in the approved construction documents and shall verify the original decal and serial number of each unit to be inspected. The third party inspector may require the industrialized builder to uncover portions of the building as necessary to verify compliance. The inspection shall be terminated, and the alteration decals returned to the department, if inspection reveals that the units have been altered from the approved construction documents. The inspection shall be terminated and the alteration decals returned to the department if inspection reveals that the units are not those identified by serial number and decal number in the approved construction documents.

(8) [ (3) ] An alteration data plate shall be affixed to any building, in the vicinity of the original data plate on the building, and as depicted on the approved construction documents, where the alteration or recertification results in a reclassification of the occupancy group or construction type, a change in the type of gas required for appliances, or a change in the wind speed and exposure, maximum snow (roof) load, seismic design criteria, or special conditions or limitations. The data plate shall contain such information as specified in subsection (g) of this section. A copy of the data plate shall be retained by the industrialized builder and be made available to the Department upon request.

(9) The industrialized builder shall maintain all records pertinent to the recertification and make these records available to the Department upon request. Records shall be maintained for as long as the building remains a part of the inventory for that builder.

(10) Buildings constructed on or after July 1, 2004 may only be recertified in accordance with subsections (f)(1) or (f)4) without prior written authorization from the department.

(g) A recertification or [ An ] alteration data plate shall be placed by the third party inspector on each altered or recertified house or building as required by this section. The data plate shall be supplied by the industrialized builder or installation permit holder. An alteration data plate shall be made of a material that will not deteriorate over time and shall be permanently placed so that it cannot be removed without destruction. The data plate shall be placed adjacent to the original data plate in an easily accessible location as designated in the alteration plans, but shall not be located on any readily removable item such as a cabinet door or similar component. Location of the data plate on the cover of the electrical distribution panel is acceptable. An alteration data plate shall contain, as a minimum, the information required on a manufacturer's data plate as required by §70.71(b)(2-11) plus the following information:

(1) the name, address, and registration number assigned by the department of the industrialized builder, or the name, address, and installation permit number assigned by the department of the owner of the house or building; and

(2) the Texas alteration decal numbers.

§70.101.Amendments to Mandatory Building Codes.

(a) The council shall consider and review all amendments to these codes which are approved and recommended by ICC, and if they are determined to be in the public interest, the amendments shall be effective 180 days following the date of the council's determination or at a later date as set by the council.

(b) Any amendment proposed by a local building official, and determined by the council following a public hearing to be essential to the health and safety of the public on a statewide basis, shall become effective 180 days following the date of the council's determination or at such a later date as set by the council.

(c) The National Electrical Code shall be amended as follows.

(1) Add to Article 310.1 the following statement: "Aluminum and copper-clad aluminum shall not be used for branch circuits in buildings classified as a residential occupancy; aluminum and copper-clad aluminum conductors, of size number 4 AWG or larger, may be used in branch circuits in buildings classified as occupancies other than residential."

(2) Add to Article 110.14 the following statement: "Aluminum and copper-clad aluminum conductors shall be terminated using approved compression-type crimp lugs with approved inhibitors."

(d) The International Building Code shall be amended as follows.

(1) Revise §101.1 to read "These regulations shall be known as the Building Code of the Texas Industrialized Housing and Buildings program, hereinafter referred to as 'this code.'"

(2) Delete Chapter 11 and replace with the Texas Accessibility Standards (TAS) of Texas Government Code, Chapter 469, Elimination of Architectural Barriers, dated April 1, 1994. Buildings subject to the requirements of the Texas Accessibility Standards are described in Administrative Rules of the Texas Department of Licensing and Regulation, 16 Texas Administrative Code, Chapter 68, §68.21.

(3) Revise Chapter 35, Referenced Standards, as follows.

(A) Delete ICC/ ANSI A117.1-98, Accessible and Usable Buildings and Facilities.

(B) Add Texas Accessibility Standards (TAS) dated April 1, 1994.

(4) Wherever reference elsewhere in the code is made to ICC/ANSI A177.1, the Texas Accessibility Standards (TAS) shall be substituted.

(5) Revise §101.2, Exception 2, to read "Existing buildings that are undergoing repair, alterations or additions and change of occupancy shall comply with the International Existing Building Code."

(e) Section 101.1 of the International Fuel Gas Code shall read as follows: "These regulations shall be known as the Fuel Gas Code of the Texas Industrialized Housing and Buildings program, hereinafter referred to as 'this code.'"

(f) Section 101.1 of the International Plumbing Code shall read as follows: "These regulations shall be known as the Plumbing Code of the Texas Industrialized Housing and Buildings program, hereinafter referred to as 'this code.'"

(g) Section 101.1 of the International Mechanical Code shall read as follows: "These regulations shall be known as the Mechanical Code of the Texas Industrialized Housing and Buildings program, hereinafter referred to as 'this code.'"

(h) Section R101.1 of the International Residential Code shall read as follows: "These provisions shall be known as the Residential Code for One- and Two-Family Dwellings of the Texas Industrialized Housing and Buildings program, and shall be cited as such and will be referred to herein as 'this code.'"

(i) The International Existing Building Code shall be amended as follows.

(1) Section 101.1 shall read as follows: "These regulations shall be known as the Existing Building Code of the Texas Industrialized Housing and Buildings program, hereinafter referred to as 'this code.'"

(2) Revise Chapter 14, Referenced Standards, as follows:

(A) Delete ICC/ANSI A117.1-98, Guidelines for Accessible and Usable Buildings and Facilities.

(B) Add Texas Accessibility Standards (TAS) dated April 1, 1994.

(3) Wherever reference elsewhere in the code is made to ICC/ANSI A117.1, the Texas Accessibility Standards (TAS) shall be substituted.

(4) Wherever reference elsewhere in the code is made to chapter 11, or portions of chapter 11, of the International Building Code , the Texas Accessibility Standards (TAS) shall be substituted.

(5) Delete Chapter 10, Historic Buildings.

(6) Section 1201.2 shall read as follows: "Structures existing prior to July 1, 2004 in which there is work involving additions, alterations, or changes of occupancy shall be made to conform to the requirements of this chapter or the provisions of Chapters 4 through 9."

§70.102.Use and Construction of Codes.

(a) Industrialized housing or buildings shall be constructed to meet or exceed the mandatory building code standards and requirements referenced in §70.100 and §70.101 in effect at the time of construction. A building that has not been previously occupied or used for its intended purpose shall comply with the provisions of the mandatory building codes referenced in §70.100 and §70.101 for new construction. Industrialized housing and buildings shall be installed in accordance with the mandatory building code standards and requirements referenced in §70.100 and §70.101.

(b) Alterations of industrialized housing and permanent industrialized buildings shall be [ in accordance with the mandatory building code standards and requirements referenced in §§70.100 and 70.101 and ] in accordance with §70.74 and shall comply with the provisions of the codes referenced in §70.100 and §70.101 for new structures .

(c) Industrialized buildings designed to be moved from one commercial site to another commercial site shall be recertified or altered in accordance with the mandatory building code standards and requirements referenced in §70.100 and §70.101 and in accordance with §70.74. Alterations of buildings shall comply with the standards and requirements of the following codes for each type of recertification class.

(1) Recertification class 1 and class 4: Alterations shall comply with the International Existing Building Code as referenced in §70.101. Alterations of buildings that have not been previously occupied or used for their intended purpose shall comply with the provisions of the codes referenced in §70.100 and §70.101 for new construction.

(2) Recertification class 2 and class 3: The existing building as altered, and additional alterations to the building, shall comply with the provisions of the International Existing Building Code as referenced in §70.101.

(d) [ (b) ] The codes adopted in §70.100 and §70.101 shall be construed to conform to the intent of Chapter 1202 and these rules and regulations. For example, where reference is made in any of the codes to the building official, the plumbing or mechanical official, or the administrative authority or enforcement official, such reference shall be construed pursuant to Chapter 1202 and the sections in this chapter to mean, where applicable, the council, the local building official, or the department.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on February 14, 2005.

TRD-200500675

William H. Kuntz, Jr.

Executive Director

Texas Department of Licensing and Regulation

Earliest possible date of adoption: March 27, 2005

For further information, please call: (512) 463-7348


Chapter 75. AIR CONDITIONING AND REFRIGERATION CONTRACTOR LICENSE LAW

16 TAC §75.25

The Texas Department of Licensing and Regulation ("Department") proposes new 16 Texas Administrative Code §75.25, concerning continuing education requirements in the air conditioning and refrigeration contractor program.

Under Texas Occupations Code, §51.405, The Texas Commission of Licensing and Regulation is required to recognize, prepare, or administer continuing education programs for license holders, and a license holder must participate in the programs to the extent required by the Commission to keep the person's license. The new rule implements that statutory requirement in the air conditioning and refrigeration contractor program. General requirements for continuing education providers and courses are contained in 16 Texas Administrative Code, Chapter 59. The new §75.25 establishes requirements that are specific to the air conditioning and refrigeration contractor program, for licensees, providers, and courses.

The new rule requires a licensee to complete six hours of continuing education in Department-approved courses to renew a license. The continuing education hours must include two hours of instruction in Texas state law and rules that regulate the conduct of licensees. The continuing education hours must be completed during the term of the current license or, in the case of a late renewal, within the one-year period prior to the date of renewal. A licensee may not receive credit for attending the same course more than once. Under Chapter 59 of the Department's rules, a course is approved for a one year period and then must be re-approved annually as a new course. A licensee is required to retain a copy of the certificate of completion for one year after the date of completion of the course. The rule requires that, to be approved by the department, a provider's course must cover one or more specified topics. The rule applies to providers and courses upon the effective date of the rule. The rule applies to air conditioning and refrigeration contractor licenses that expire on or after January 1, 2006.

This rule is necessary to implement Texas Occupations Code, §51.405, which requires the Texas Commission of Licensing and Regulation ("Commission") to recognize, prepare, or administer continuing education programs for license holders.

William H. Kuntz, Jr., Executive Director, has determined that for the first five-year period the new rule is in effect there will be some additional costs to the Department in approving courses and enforcing requirements of the rule. It is anticipated that revenue from additional fees established in 16 Texas Administrative Code Chapter 59 would be sufficient to offset additional costs to the state. Because the number of potential continuing education providers is unknown, the Department is unable to estimate the additional costs or revenue. There will be no cost to local government as a result of enforcing or administering the new rule.

Mr. Kuntz also has determined that for each year of the first five-year period the new rule is in effect, the public benefit will be that continuing education taken by air conditioning and refrigeration contractors will be subject to minimum standards. The public will benefit from standards that serve to increase or maintain the skills and competence of licensees, who in turn provide services to the public.

Mr. Kuntz has determined that for each year of the first five years that the rule will be in effect, there will be some economic cost to persons who are required to comply with the proposed rule, including some cost to small and micro-businesses. Providers of continuing education courses likely will charge a fee to participants, and this will result in some cost to licensees and their companies. Because the fees charged by providers may vary widely, we are unable to provide a precise estimate of the costs to licensees. Costs of complying with the rule are anticipated to be reasonably low in comparison with the benefits of the rule.

Comments on the proposal may be submitted to William H. Kuntz, Jr., Executive Director, Texas Department of Licensing and Regulation, P.O. Box 12157, Austin, Texas 78711, or facsimile (512) 475-3032, or electronically: whkuntz@license.state.tx.us. The deadline for comments is 30 days after publication in the Texas Register .

The new rule is proposed under Texas Occupations Code, Chapter 1302 and Chapter 51, which authorizes the Department to adopt rules as necessary to implement this chapter and any other law establishing a program regulated by the Department. In particular, the rule implements Texas Occupations Code, §51.405.

The statutory provisions affected by the proposal are those set forth in Texas Occupations Code, Chapters 51 and 1302. No other statutes, articles, or codes are affected by the proposal.

§75.25.Continuing Education.

(a) Terms used in this section have the meanings assigned by Chapter 59 of this title, unless the context indicates otherwise.

(b) To renew a license as an air conditioning and refrigeration contractor under Texas Occupations Code, Chapter 1302, Subchapter F, a licensee must complete eight hours of continuing education in courses approved by the department, including two hours of instruction in Texas state law and rules that regulate the conduct of licensees.

(c) The continuing education hours must have been completed within the term of the current license, in the case of a timely renewal. For a late renewal, the continuing education hours must have been completed within the one year period immediately prior to the date of renewal.

(d) A licensee may not receive continuing education credit for attending the same course more than once.

(e) A licensee shall retain a copy of the certificate of completion for a course for one year after the date of completion. In conducting any inspection or investigation of the licensee, the department may examine the licensee's records to determine compliance with this subsection.

(f) To be approved under Chapter 59 of this title, a provider's course must be dedicated to instruction in one or more of the following topics:

(1) Texas Occupations Code, Chapter 1302, Air Conditioning and Refrigeration Contractors;

(2) Title 16, Texas Administrative Code, Chapter 75, Air Conditioning and Refrigeration Administrative Rules;

(3) the International Mechanical Code, the Uniform Mechanical Code, or other applicable codes;

(4) ethics;

(5) business practices; or

(6) technical requirements.

(g) This section shall apply to providers and courses for air conditioning and refrigeration contractors upon the effective date of this section.

(h) This section shall apply to air conditioning and refrigeration contractor licenses issued under Texas Occupations Code, Chapter 1302, Subchapter F that expire on or after January 1, 2006.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on February 7, 2005.

TRD-200500571

William H. Kuntz, Jr.

Executive Director

Texas Department of Licensing and Regulation

Earliest possible date of adoption: March 27, 2005

For further information, please call: (512) 463-7348